Business

Budget: Government 'declaring war' on public sector

The government has been accused of "declaring war on public services", after announcing plans to freeze the pay of workers in the public sector.

Public sector union Unison said workers would be "shocked and angry" and were "the innocent victims of job cuts and pay freezes".

The TUC also branded George Osborne's Budget "dangerous" and "divisive".

Mr Osborne announced a two-year freeze in public sector pay, except for those earning less than £21,000 a year.

Some 1.7 million public sector workers whose salary falls below that threshold will get a flat pay-rise worth £250 in both years.

"Freezing public sector pay when inflation is running at 5.1% and VAT is going up, will mean a real cut in living standards for millions of ordinary workers and their families - already struggling to pay rising bills," said Dave Prentis, Unison general secretary.

"Nurses, social workers, midwives, paramedics, police community support officers, housing and environmental officers who provide vital public services, are amongst those who will be hit hardest by the two-year pay freeze. And for local government workers this comes on top of this year's freeze."

'Sluggish economy'

"We are very definitely not all in this together," said Brendan Barber, general secretary of the TUC, which represents the majority of trade unions in the UK.

The TUC had previously urged Mr Osborne not to cut corporation tax or increase VAT - two measures that were both announced in the Budget.

Corporation tax is set to fall from 28% to 24% over the next four years, while VAT will rise from 17.5% to 20% on 4 January 2011.

"Those on middle and low incomes have done worse than expected, and the rich have been let off much of what they feared," said Mr Barber.

"But we will all suffer from an economy that is now likely to be sluggish at best and with a double-dip recession at worst."

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